Thursday October 21, 2004 - 18:32:15 GMT
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Dollar Bears Don't Flinch At Positive US DATA
The US trading session continued the current trend of a lower USD. USD/JPY open the session 107.65/70 and has never looked back. Despite a better than expected (345K) Initial Jobless Claims number (329K) the dollar couldn’t hold the line, as it traded down to a session low of 107.30/35. The Leading Indicators came out as expected -.1 and the Philly Fed came out much better (28.5) than the expected (18) and still the dollar struggled to rally as 107.50 held after the Philly Fed. In similar action EUR/USD started the day at 1.2600/05 and had an initial drop to session lows of 1.2585/90 after the Initial Claims came out, but whipped back to a high of 1.2635/40. The Philly Fed release caused a similar reaction dropping down to approximately 1.2600 and back to the session high. USD/CAD knifed down from the open 1.2470/75 to a midday low of 1.2405/10 and seems to be continuing this trend throughout the day. The market seems headed for a quiet Friday in terms of data releases but is very concerned with the anticipation of possible BOJ intervention. News out of Japan is that the BOJ is closely monitoring the current situation and has said that, “appropriate action will be taken as needed.” I wouldn’t be surprised to see a dollar rally into the weekend as the most of the market rallies in the Greenback are being met with fresh selling to either establish shorts or add to them.
TECHNICALLY SPEAKING Dollar/Jpy remains below it’s 30 50 and 200 hr moving averages on a 60 minute chart. There is technical support seen at 106.90/107.10. on this same 60 minute chart .There is also 107.00 support seen on a daily chart that dates back to mid June. The Relative Strength Index has a negative reading of 25.13.
GAIN AN EDGE We look to buy Dollar/Jpy on a dip to 107.00 with a stop below 106.70 and a take profit of 108.20
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